European Union (Withdrawal) Act

Part of Leaving the EU – in the House of Commons at 6:27 pm on 14th January 2019.

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Photo of Liam Fox Liam Fox The Secretary of State for International Trade and President of the Board of Trade 6:27 pm, 14th January 2019

The hon. Gentleman should not put himself down in that way; that is normally the business of those on the other side of the House.

It is clear that if we do not accept a negotiated deal, the two other outcomes would be no deal or potentially no Brexit, and I do not think that either of those are acceptable. The Government have been clear that we neither want nor expect a no-deal scenario, but of course the Government will continue to do the responsible thing and prepare for all eventualities in case a final agreement cannot be reached. However, the evidence is clear that the best way forward for our businesses, as my right hon. Friend Dame Cheryl Gillan eloquently set out, and for jobs and for our collective prosperity, is to have a Brexit deal.

Some have suggested that it would be possible under article XXIV of the general agreement on tariffs and trade to maintain tariff-free trade as an alternative to the negotiated agreement in a no-deal scenario. There are two immediate problems facing that suggestion. The first is that it would require the agreement of the EU and be based on the expectation of a future trade agreement or customs union to be operable in WTO law. Although it might be argued, as I am sure many in the House would, that that would be in the economic interests of the EU27, we all know from experience that the politics of the EU can take precedence over economic pragmatism. In the political atmosphere of no deal, it would be difficult to cultivate the good will necessary for that to proceed. Secondly, that suggestion would not deal with all the regulatory issues—the non-tariff barriers—that are so important to many businesses.